GBP/USD moves to a session high of 1.2181 as buyers start making their case for a break to the upside
Price has been consolidating for the most part over the past week but with any coiled up spring, the release will see things move more jumpy and suddenly.
For cable, price action has been sitting in a narrowing near-term wedge centred around the 100-hour MA (red line) and 200-hour MA (blue line). Eventually, there’s going to be a break on either side and we could finally see some directional movement in the pair.
As it stands, buyers are trying to seize control as price moves higher above the 200-hour MA. The topside wedge trendline resistance sits at 1.2190 and buyers will have to break above that and offers around 1.2200 to secure more momentum to the upside.
As for sellers, the downside wedge trendline support rests at 1.2137 and that is the key level to breach to chase a move to the downside towards 1.2100 again.
With Brexit developments continuing to sit in limbo until September and markets navigating through a bit of a flux in risk sentiment, you can always rely on technicals to provide some added guidance. In my view, the next trade will be to go with the directional break on either side of the narrowing wedge above.